Correlation Between Retail Opportunity and EastGroup Properties
Can any of the company-specific risk be diversified away by investing in both Retail Opportunity and EastGroup Properties at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Retail Opportunity and EastGroup Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Retail Opportunity Investments and EastGroup Properties, you can compare the effects of market volatilities on Retail Opportunity and EastGroup Properties and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Retail Opportunity with a short position of EastGroup Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Retail Opportunity and EastGroup Properties.
Diversification Opportunities for Retail Opportunity and EastGroup Properties
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Retail and EastGroup is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Retail Opportunity Investments and EastGroup Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EastGroup Properties and Retail Opportunity is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Retail Opportunity Investments are associated (or correlated) with EastGroup Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EastGroup Properties has no effect on the direction of Retail Opportunity i.e., Retail Opportunity and EastGroup Properties go up and down completely randomly.
Pair Corralation between Retail Opportunity and EastGroup Properties
Given the investment horizon of 90 days Retail Opportunity Investments is expected to generate 1.78 times more return on investment than EastGroup Properties. However, Retail Opportunity is 1.78 times more volatile than EastGroup Properties. It trades about 0.27 of its potential returns per unit of risk. EastGroup Properties is currently generating about 0.0 per unit of risk. If you would invest 1,551 in Retail Opportunity Investments on August 30, 2024 and sell it today you would earn a total of 188.00 from holding Retail Opportunity Investments or generate 12.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Retail Opportunity Investments vs. EastGroup Properties
Performance |
| Timeline |
| Retail Opportunity |
| EastGroup Properties |
Retail Opportunity and EastGroup Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Retail Opportunity and EastGroup Properties
The main advantage of trading using opposite Retail Opportunity and EastGroup Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Retail Opportunity position performs unexpectedly, EastGroup Properties can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in EastGroup Properties will offset losses from the drop in EastGroup Properties' long position.| Retail Opportunity vs. Kite Realty Group | Retail Opportunity vs. Urban Edge Properties | Retail Opportunity vs. Acadia Realty Trust |
| EastGroup Properties vs. Terreno Realty | EastGroup Properties vs. Plymouth Industrial REIT | EastGroup Properties vs. LXP Industrial Trust | EastGroup Properties vs. First Industrial Realty |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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